Complaint No C30220 [2019] NZREAA 109 (12 September 2019)

Last Updated: 29 November 2019

Before the Complaints Assessment Committee

Complaint No: C30220

In the Matter of:	Part 4 of the Real Estate Agents Act 2008
And
The Agency:	The Agency (XXXXXXXX)

Decision of Complaints Assessment Committee

Decision to take no further action

12 September 2019

Complaints Assessment Committee: CAC 520

Chairperson: Bernardine Hannan

Deputy Chairperson: Peter Brock

Panel Member: Craig Edwards

Complaints Assessment Committee

Decision to take no further action

1. The Complaint

1.1. On 27 February 2019 the Real Estate Agents Authority (the Authority) received a complaint against the Agency from the Complainant.

1.2. The Agency is a licensed Agent Company under the Real Estate Agents Act 2008 (the Act).

1.3. The complaint relates to the Agency’s website.

1.4. The detail of the complaint is that the Complainant says the Agency misled the public by linking Ms A’s name to its own agency on its website when Ms A had no connection to the Agency.

1.5. In particular the Complainant, who is longstanding client and friend of Ms A, advised that when he googled ‘Ms A Real Estate’ ‘Ms A Auctions’ and ‘Ms A’ to find his listing, the first link that appeared for all searches says, ‘Ms A The Agency’.

1.6. The Complainant says the Agency was trying to steal Ms A’s branding and that the Agency was acting unethically and is bringing the industry into disrepute.

1.7. The Agency responded to the complaint against it by admitting an error had been made in linking Ms A’s name to its website and that this had occurred when a third-party, Ms B who was not employed by the Agency mistakenly linked Ms A’s name as a Google AdWord to its site. However, the Agency denies it allowed or facilitated this mistake and therefore the error is not a breach of its professional obligations.

1.8. Further the Agency states that once this genuine error was brought to its attention it was immediately rectified. The Agency also offered to apologise to Ms A and the Complainant and to make a $400.00 donation to the victim support fund. This offer was not accepted by the Complainant.

1.9. Ms A has not filed her own complaint in relation to this matter.

2. What we decided

2.1. On 6 May 2019 the Complaints Assessment Committee (the Committee) considered the complaint and decided to inquire into it.

2.2. On 24 July 2019 and 15 August 2019, the Committee held a hearing on the papers and considered all the information gathered during the inquiry.

2.3. The Committee has decided to take no further action on the complaint.

2.4. This decision was made under section 89(2)(c) of the Act. The decision was also made with reference to the Real Estate Agents Act (Professional Conduct and Client Care) Rules 2012.

3. Our reasons for the decision

3.1. The Committee concluded:

3.2. The evidence does not support a finding of Unsatisfactory Conduct against the Agency under s 72 of the Act or the Rules.

Reason 1

3.3. The Committee accepts, as do the parties that an incorrect advertising link was created. This is not disputed.

3.4. The Complainant alleges this was a deliberate marketing activity by the Agency. The Agency says it was a genuine error through a third party that was immediately rectified once identified.

3.5. The Agency’s view is supported by the evidence of Ms B. Ms B was asked by the Agency to update their website and increase advertising effect by utilising Google AdWords incorporating a range of geographic areas to try and attract new listings. Ms B admits that she used Ms A’s name as a “keyword” for the online advertisement. Ms B has admitted to the Committee that she failed to verify the keywords with the Agency and that she entered “Ms A” on her own initiative in the mistaken belief that Ms A was an employee of the Agency. When this mistake was brought to her attention, she immediately withdrew the AdWord.

3.6. Ms B states the mistake was entirely hers and she was never instructed by the Agency to use Ms A’s name in any way. Further Ms B claims there would be no strategic benefit or advantage in the mistake of including Ms A’s name as any search of “Ms A” would result in the link taking the viewer to the Agency website and there were no listings for Ms A on the site.

3.7. The Committee is not determining civil liability, if any, or the conduct of Ms B. Rather the Committee is considering whether any behaviour of the Agency has fallen below the accepted standard. Mistakes are made. On occasion, such mistakes are simply that, mistakes. On other occasions such mistakes, in the context of real estate agency work, could be the result of licensee behaviour that falls short of the standard that a reasonable member of the public is entitled to expect from a reasonably competent licensee or is in contravention of the Act or Rules, is incompetent or negligent or would reasonably be regarded by agents of good standing as being unacceptable.

3.8. In this instance the Agency contracted a professional to update their website. There is no reason to believe Ms B was not qualified to carry out this work. Ms B has provided evidence she works in the area of digital marketing and advertising.

3.9. There is no evidence before the Committee that the Agency did not adequately instruct Ms B.

The evidence before the Committee supports the Agency’s submission that as this was one of the first campaigns it undertook to try and attract listings for properties for sale, discussions were more of a general nature and it took advice and guidance from a person with that particular skill, Ms B. No particular instructions as to how the advertising would be effected were given by the Agency, rather the Agency relied on the advice it was given by Ms B.

3.10. The Committee has considered how Ms A’s name came to be linked with the Agency website and is not persuaded this was a result of any negligence on the Agency’s behalf. All keyword names linked to the campaign, were the names of the Agency’s licensed salespeople at that time. It is accepted by the Committee that Ms A’s name was also added, though Ms B

misunderstanding that Ms A was also employed by the Agency. Ms A’s name had previously been mentioned in terms of a business being located within one of the geographical catchment areas that the Agency worked in. Ms B has confirmed that she mistakenly assumed that Ms A was a salesperson working for the Agency and that she did not check or confirm this before adding her name to the keyword search.

3.11. Given this finding, the Committee is unable to conclude that the Agency has been negligent in allowing Ms A’s name to be linked to its website or that in doing so it has failed to exercise the skill, care, competence, and diligence required of a Licensee in attempting to attract clients.

3.12. This view is supported by the Agency’s response once the mistake was realised. There is no evidence the Agency would have been able to determine the mistake by view or reviewing the website prior to the Complainant raising the matter. A simple viewing of the website would not reveal the link and only by typing in the linked names would the mistake be revealed. There is no evidence before the Committee that would support a finding that the Agency was or should have been aware of the incorrect link before the matter was brought to its attention.

3.13. Once the mistake was brought to its attention the Agency acted immediately removing the link by 10.10 am the next day. The Agency also offered an apology to both the Complainant and Ms A as well as a not insubstantial donation to a worthy cause. This offer was rejected by the Complainant who preferred to have the matter determined in a more formal way through the Committee. The Committee is not persuaded the Agency has acted negligently or unacceptably in this matter or that its behaviour falls short of the standard that a reasonable member of the public is entitled to expect.

3.14. Even if the Committee is wrong in finding the Agency has not breached the Rules and Rule 6.4 in particular does impose a strict liability obligation not to mislead a customer or client, even without any action or statement on a licensee’s part, (in this case the Committee has found on the evidence before it that it was not the actions of the Agency that caused Ms A’s name to be linked to the website, but rather the actions of Ms B, who has no connection with the Agency other than as a third party contractor) then the Committee has determined to take no further action under s80(2) of the Act.

3.15. Under s80(2) “...the Committee may, in its discretion, decide not to take any further action on a complaint, if in the course of the investigation of the complaint, it appears to the Committee that, any further action is unnecessary or inappropriate.”

3.16. In reaching this view the Committee has considered the High Court case of Vosper v REAA & Biddle [2017] NZHC 53. Here the court held that;

“A balance needs to be struck between the competing goals of promoting a consistent and effective disciplinary process and avoidance of the stigma of a finding of unsatisfactory conduct, where the conduct an issue is relatively minor and all other circumstances point to the absence of the need to mark the conduct in that way.”1

3.17. In this case, the Committee has held that the Agency took no part in linking Ms A’s name to its website, it was not negligent in its instructions to Ms B, there was no realistic ability for the Agency to be aware of this error until a browser brought this matter to its attention, the Agency took immediate steps to remedy once the matter was brought to its attention, and an apology was immediately offered to both Ms A and the Complainant with an offer to make a

1 Vosper (Supra) paragraph 74

donation to a charity. Further there is no evidence the misplaced link caused any harm to the Complainant, Ms A or any member of the public. A finding of unsatisfactory conduct in such circumstances would not meet the objectives of the Act.

4. What happens next

Your right to appeal

4.1. If you are affected by this decision of the Committee, the right to appeal is set out in section

111. You may appeal in writing to the Real Estate Agents Disciplinary Tribunal (the Tribunal) within 20 working days after the date notice is given of this decision. Your appeal must include a copy of this decision and any other information you wish the Tribunal to consider in relation to the appeal. The Tribunal has a discretion to accept a late appeal filed within 60 working days after the date notice is given of this decision, but only if it is satisfied that exceptional circumstances prevented the appeal from being made in time.

4.2. For further information on filing an appeal, read Guide to Filing an Appeal on the Real Estate Agents Disciplinary Tribunal website (https://www.justice.govt.nz/tribunals/real-estate- agents/).

Publication

4.3. At the Committee’s discretion, the decision will be published with the names or identifying details of the Complainant (including the address of the Property), the Licensee and any third parties.

4.4. The Authority will publish the Committee’s decision after the period for filing an appeal has ended, unless the Tribunal receives an application for an order preventing publication. The Authority will not publish the Committee’s decision until the Tribunal has made a decision on the application.

4.5. Publishing the Committee’s decision supports the purpose of the Act by ensuring that the disciplinary process remains transparent, independent and effective. The Committee also considers that publishing this decision helps to set industry standards and that is in the public interest.

Signed

Bernardine Hannan

Date: 12 September 2019

Appendix 1: Relevant provisions

The Real Estate Agents Act 2008 provides:

79 Procedure on receipt of complaint

(1) As soon as practicable after receiving a complaint concerning a licensee, a Committee must consider the complaint and determine whether to inquire into it.

(2) The Committee may—

(a) determine that the complaint alleges neither unsatisfactory conduct nor misconduct and dismiss it accordingly:

(b) determine that the complaint discloses only an inconsequential matter, and for this reason need not be pursued:

(c) determine that the complaint is frivolous or vexatious or not made in good faith, and for this reason need not be pursued:

(d) determine that the complaint should be referred to another agency, and refer it accordingly:

(e) determine to inquire into the complaint.

89 Power of Committee to determine complaint or allegation

(1) A Committee may make 1 or more of the determinations described in subsection (2) after both inquiring into a complaint or allegation and conducting a hearing with regard to that complaint or allegation.

(2) The determinations that the Committee may make are as follows:

(a) a determination that the complaint or allegation be considered by the Disciplinary

Tribunal:

(b) a determination that it has been proved, on the balance of probabilities, that the licensee has engaged in unsatisfactory conduct:

(c) a determination that the Committee take no further action with regard to the complaint or allegation or any issue involved in the complaint or allegation.

(2) Nothing in this section limits the power of the Committee to make, at any time, a decision under section 80 with regard to a complaint.

111 Appeal to Tribunal against determination by Committee

(1) A person affected by a determination of a Committee may appeal to the Tribunal against a determination of the Committee within 20 working days after the date of the notice given under section 81 or 94.

(2) The appeal is by way of written notice to the Tribunal of the appellant's intention to appeal, accompanied by—

(a) a copy of the notice given to the person under section 81 or 94; and

(b) any other information that the appellant wishes the Tribunal to consider in relation to the appeal.

(3) The appeal is by way of rehearing.

(4) After considering the appeal, the Tribunal may confirm, reverse, or modify the determination of the Committee.

(5) If the Tribunal reverses or modifies a determination of the Committee, it may exercise any of the powers that the Committee could have exercised.